nep-pol New Economics Papers
on Positive Political Economics
Issue of 2011‒10‒15
thirteen papers chosen by
Eugene Beaulieu
University of Calgary

  1. CHILLING EFFECTS: The influence of partner incarceration on political participation By Naomi F. Sugie
  2. Electoral Cycles in Active Labor Market Policies By Mario Mechtel; Niklas Potrafke
  3. Quantifying Parliamentary Representation of Constituents' Preferences with Quasi-Experimental Data By David Stadelmann; Marco Portmann; Reiner Eichenberger
  4. The Political Economy of Decentralization in Thailand - Does Decentralization Allow for Peasant Participation? By Dufhues, Thomas; Theesfeld, Insa; Buchenrieder, Gertrud; Munkung, Nuchanata
  5. Race v. Suffrage: The Determinants of Development in Mississippi By Bertocchi, Graziella; Dimico, Arcangelo
  6. Looking at the LEADER Programme from the Angle of Political Accountability: Evidence from Poland By Falkowski, Jan
  7. Compulsory voting and tax revenues By Mutascu, Mihai
  8. Green polities: urban environmental performance and government popularity By Laura Bianchini; Federico Revelli
  9. From Taxes to Politics, from Politics to Taxes: Evidence of Yardstick Competition in the Italian Municipalities By Ilaria Petrarca, IMT Lucca, Lucca Italy; Fabio Padovano, University of Rennes I, CREM-CNRS, Condorcet Center
  10. NIMBY Clout on the 2011 Italian Nuclear Referendum By G. Pignataro; G. Prarolo
  11. When are Private Standards more Stringent than Public Standards? By Vandemoortele, Thijs
  12. The Political Economy of State Government Subsidy Adoption: The Case of Ethanol By Mark, Skidmore; Chad, Cotti; James, Alm
  13. Some Inconvenient Truths About Climate Change Policy: The Distributional Impacts of Transportation Policies By Stephen P. Holland; Jonathan E. Hughes; Christopher R. Knittel; Nathan C. Parker

  1. By: Naomi F. Sugie (Princeton University)
    Abstract: The prevalence of criminal justice involvement among low-income minority men has had many negative and often unforeseen consequences for ex-felons, their families, and their neighborhoods. One consequence felon disenfranchisement laws and low levels of political engagement among ex-felons more generally has measurably altered the outcomes of state and national elections. At the same time, studies in political science more generally provide strong empirical evidence that spouses and partners influence an individual‘s political behavior. Drawing on these two areas of research, this paper considers whether political disengagement among ex-felons has had negative consequences for the voting behavior and political engagement of partners. Using data from the Fragile Families and Child Wellbeing Survey, the results find that partner incarceration is negatively associated with voting and political involvement. This association is entirely mediated by a partner‘s voting behaviors and his beliefs about his voting eligibility, regardless of state disenfranchisement laws. The political disengagement of not only ex-felons but also their partners has important implications for theories of social exclusion and the governance of marginalized groups. A large and growing population of the politically disengaged, economically marginal, and socially excluded likely has critical repercussions for US politics, democracy, and our social contract.
    Keywords: disenfranchisement, voting, prison, minority men, families
    JEL: D10 I39 J12 J13 I21
    Date: 2011–07
  2. By: Mario Mechtel (Faculty of Economics and Social Sciences, Eberhard Karls University Tübingen, Germany); Niklas Potrafke (Department of Economics, University of Konstanz, Germany)
    Abstract: We examine how electoral motives influence active labor market policies that promote (short term) job-creation. Such policies reduce measures of unemployment. Using German state data for the period 1985 to 2004, we show that election-motivated politicians pushed jobpromotion schemes before elections.
    Keywords: political business cycles, opportunistic politicians, active labor market policies
    JEL: P16 J08 H72 E62 H61
    Date: 2011–10–06
  3. By: David Stadelmann; Marco Portmann; Reiner Eichenberger
    Abstract: We assess the effect of constituents’ preferences on legislators’ decisions within a quasiexperimental setting: In the Swiss referendum process, citizens and legislators reveal their preferences for legislative proposals. We match roll call votes of all Swiss legislators on 102 legislative proposals with revealed constituents’ preferences on exactly the same issues from 1996 to 2008. The setting allows us to quantify the quality of parliamentary representation and we identify conditions which affect convergence between constituents’ preferences and legislators’ decisions. Results show that a legislator’s probability to accept a law proposal increases by 16.8 percentage points when district voters accept the proposal.
    Keywords: Political Representation; Constituents’ Preferences; Spatial Voting Models; Referenda
    JEL: D7 H7
    Date: 2011–01
  4. By: Dufhues, Thomas; Theesfeld, Insa; Buchenrieder, Gertrud; Munkung, Nuchanata
    Abstract: One of the most important issues in rural development is empowerment and entitlement of farmers through participation. Decentralisation and participation are seemingly interdependent. Therefore, the paper begins with a theoretical discussion on the cause and effects of this interdependence. Decentralisation is often advertised as means to better incorporate the views and wishes of local actors. Yet, a decentralization process is no guaranty for political participation of local actors. The state induced decentralisation process in rural Thailand serves as an example to investigate forces that hamper or facilitate political participation. Change and uncertainty are inherent of political systems and the agricultural sector. Hence, this paper focuses in particular, on the last two politically turbulent decades in Thailand and its impact on political participation in rural Thailand. The Tambon Administration Organization (TAO) as one means of and likewise outcome of the decentralization process will serve as an example to discuss the effects of decentralisation on participation in the TAOs, using the concept of accountability. After increasing decentralization at the end of the 90s the last decade was coined by centralization policies. The ongoing political unrest could potentially trigger a new wave of political decentralization. However, the real reason for decentralization is not to distribute power but to maintain central effectiveness. Thus, we expect to see more decentralization without participation.
    Keywords: Agricultural and Food Policy,
    Date: 2011
  5. By: Bertocchi, Graziella; Dimico, Arcangelo
    Abstract: We investigate the long term determinants of political and economic outcomes over a new data set composed of Mississippi counties. We analyze the effect of disfranchisement on voting registration at the end of the nineteenth century (1896-9), as well as the impact of voting registration on education outcomes at different points in time, namely in 1917 and in the 1950s. Finally, we turn to the determinants of a broad array of development indicators for the year 1960 and for the 1960-2000 period. Our main conclusion is that race, rather than political institutions and education policies, is the main force driving the above outcomes.
    Keywords: development; education; inequality; institutions; race
    JEL: E25 H52 J15 N31 O11 P16
    Date: 2011–10
  6. By: Falkowski, Jan
    Abstract: The âLEADER community initiativesâ and the âLEADER approachâ have been commonly accepted as an innovative way for development of rural areas in the EU. It is widely assumed that promoting growth in rural areas can be achieved through partnerships between representatives of three classes of local actors: civil society, public administration and private/economic sector. While these partnerships certainly have the potential to improve coordination mechanisms that manage local resources, their existence is likely to have an impact on the distribution of political advantages and future economic rents of current incumbents. What follows, it is reasonable to assume that local political elites may either block or impede the adoption of this institutional innovation. This paper investigates these issues using the Pilot Programme LEADER+ experiences in Poland. The focus is on institutional aspects that are thought to affect the electoral process. Consistent with a large body of political economy literature, our results suggest that LEADER-type partnerships are more likely to occur in an environment where holding politicians to account is easier.
    Keywords: political accountability, local government, rural development, Leader, Community/Rural/Urban Development, D72, D78, H77, O18,
    Date: 2011
  7. By: Mutascu, Mihai
    Abstract: Using a panel-model approach, this paper investigates the validity of the relationship between level of tax revenues and type of voting. The data-set covers the period 2000-2010, and includes 135 countries. The main finding points out that the assumed function is linear and the compulsory vote tends to increase the tax revenues collected by public authority. The analysis in this paper covers the “gap” in the literature in this field.
    Keywords: Tax revenues; Compulsory voting; Voluntary voting; Effects; Tax policy
    JEL: D70 H20 C23
    Date: 2011–10–09
  8. By: Laura Bianchini (University of Torino); Federico Revelli (University of Torino)
    Abstract: Ascertaining whether local election results are driven by incumbents’ performance while in office or mechanically reflect constituencies’ ideological affiliation and macroeconomic conditions is crucial for evaluating the alleged accountability-enhancing property of decentralization. Based on a unique score of urban environmental performance and the results of all elections held in the major Italian cities over a decade, we investigate the role of local (fiscal and environmental) versus national issues in municipal elections. While the empirical evidence points to a strong ideological attachment and a somewhat weaker fiscal conservatism, it reveals that media reported environmental ranking has a considerable impact on the popularity of city governments.
    Keywords: Local elections, vote function, environmental performance, property tax
    JEL: D72 H71 Q58
    Date: 2011
  9. By: Ilaria Petrarca, IMT Lucca, Lucca Italy; Fabio Padovano, University of Rennes I, CREM-CNRS, Condorcet Center
    Abstract: Strategic interaction in local tax setting is motivated with yardstick competition only when the fiscal decision influences the incumbents’ probability of being re-elected. Most of the previous analyses draw conclusions on yardstick competition without estimating this link or failing to find any empirical support for it. This paper, on the contrary, conducts a comprehensive test of yardstick competition on Italian Municipalities during the period 1995-2004. First, a vote popularity function is estimated. The empirical findings verify the economic voting behavior and are robust to alternative empirical specifications of the dependent variable. Then, a spatial tax setting equation is estimated. The results show a pattern of mimicking driven by a positive spatial lag coefficient and a negative spatial error coefficient. Finally, the estimated spatial correlation coefficients in time are used to investigate the dynamics of strategic interaction. The results depict a quasi monotonic pattern of convergence of the coefficients towards the lowest levels of spatial interaction, suggesting that a progressive reduction of the mimicking behavior of the incumbents has taken place.
    Keywords: Yardstick competition, vote popularity function, spatial panel regression
    JEL: C21 D72 H71
    Date: 2011–07
  10. By: G. Pignataro; G. Prarolo
    Abstract: This paper claims that the 2011 Italian referendum on nuclear power is taking shape as a clean laboratory for the measurement of one of the main aspects of the NIMBY (Not In My BackYard) issue. Since the citizens voted on the possibility for the government to set up new nuclear plants in well-known sites, we identify community preferences for their locations across Italian municipalities using the turnout rate. The Fukushima nuclear disaster that happened a few months before the referendum may have magnified negative attitudes toward nuclear power. Thus, taking into account regional and political features that may influence ideological aversion to nuclear power, we still find highly negative correlation between distance from nuclear sites and the turnout rate.
    JEL: D72 H41 Q48
    Date: 2011–09
  11. By: Vandemoortele, Thijs
    Abstract: Retailersâ private standards are increasingly important in addressing consumer concerns about safety, quality and social and environmental issues. Empirical evidence shows that these private standards are frequently more stringent than their public counterparts. I develop a political economy model that may contribute to explaining this stylized fact. I show that if producers exercise their political power to persuade the government to impose a lower public standard, retailers may apply their market power to install a private standard at a higher level than the public one.
    Keywords: Private Standards, Public Standards, Political Economy, Resource /Energy Economics and Policy,
    Date: 2011
  12. By: Mark, Skidmore; Chad, Cotti; James, Alm
    Abstract: In this paper we examine the factors that determine the adoption of state economic development incentives in the ethanol industry. We compile data on the implementation dates for subsidies/tax credits for all states for years 1984-2007, a period that covers the complete emergence of the biofuel industry in the United States and that was characterized by the passage of a numerous of state-level subsidies and tax breaks aimed at increasing ethanol production. Using Cox proportional hazard regression analysis, we find that states are more likely to adopt ethanol subsidies when corn production is high, when corn prices are low and gasoline prices are high, when a state is affiliated with the National Corn Growers Association, when a check-off is present, and when state government is under the control of Democrats.
    Keywords: ethanol; subsidies; political economy; rent seeking; proportional hazard estimation
    JEL: H25 H71
    Date: 2011–06
  13. By: Stephen P. Holland; Jonathan E. Hughes; Christopher R. Knittel; Nathan C. Parker
    Abstract: Instead of efficiently pricing greenhouse gases, policy makers have favored measures that implicitly or explicitly subsidize low carbon fuels. We simulate a transportation-sector cap & trade program (CAT) and three policies currently in use: ethanol subsidies, a renewable fuel standard (RFS), and a low carbon fuel standard (LCFS). Our simulations confirm that the alternatives to CAT are quite costly—2.5 to 4 times more expensive. We provide evidence that the persistence of these alternatives in spite of their higher costs lies in the political economy of carbon policy. The alternatives to CAT exhibit a feature that make them amenable to adoption|a right skewed distribution of gains and losses where many counties have small losses, but a smaller share of counties gain considerably—as much as $6,800 per capita, per year. We correlate our estimates of gains from CAT and the RFS with Congressional voting on the Waxman-Markey cap & trade bill, H.R. 2454. Because Waxman-Markey (WM) would weaken the RFS, House members likely viewed the two policies as competitors. Conditional on a district's CAT gains, increases in a district's RFS gains are associated with decreases in the likelihood of voting for WM. Furthermore, we show that campaign contributions are correlated with a district's gains under each policy and that these contributions are correlated with a Member's vote on WM.
    Date: 2011–08

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